Study on the Relationship between Executives' Equity Incentives and the Performance of Listed Real Estate Corporations

Abstract

Implementation of equity incentive appears an explosive growth in 2011 and 2012, but its ability to improve the corporate performance is still an urgent problem which investors and executives focus on. To enrich equity incentive research on a specific industry, this paper selected listed real estate corporations’ annual report data as samples, in markets of Shanghai and Shenzhen A-share from 2011 to 2012, and used multivariate regression analysis method to make the empirical research on the relationship between executive equity incentive and corporate performance. The results showed that both the proportion of managerial shares and the rate of change in shareholding had positive correlations with corporate performance, while there was a range effect on the performance from the proportion of managerial shares. Finally, some relevant advices were proposed on the implementation of executive equity incentive mechanism.